SEC secures preliminary injunction against Blockvest
Blockvest falsely claimed its ICO and its affiliates had regulatory approval from various agencies.
The United States Securities and Exchange Commission (SEC) has obtained a preliminary injunction against Blockvest LLC and its founder Reginald Buddy Ringgold, III aka Rasool Abdul Rahim El for making fraudulent offers of securities. On February 14, 2019, the Honorable Gonzalo P. Curiel of the United States District Court for the Southern District of California entered the relevant order.
Let’s recall that the SEC’s complaint, filed on October 3, 2018, alleged that the defendants claimed that they were planning to raise funds through an initial coin offering (ICO) for several financial products that would generate passive income and double-digit returns based on misrepresentations about the firm’s regulatory status.
According to the complaint, Blockvest falsely claimed its ICO and its affiliates had regulatory approval from various agencies. The complaint further says that Blockvest and Ringgold, who also goes by the name Rasool Abdul Rahim El, were using the SEC seal without permission, thus committing a violation of federal law. Ringgold promoted the ICO with a fake agency he created called the “Blockchain Exchange Commission,” using a graphic similar to the SEC’s seal and the same address as SEC headquarters.
Blockvest and Ringgold continued their fraudulent conduct even after the National Futures Association (NFA) sent them a cease-and-desist letter to stop them from using the NFA’s seal and from making false claims about their status with that organization.
On February 14, 2019, the court ruled that defendants are enjoined from violating provisions of the federal securities law prohibiting fraudulent offers or sales of securities. In particular, the court ruled that “based upon the additional submitted briefing [the court] concludes that Defendants made an ‘offer’ of unregistered securities which violated Section 17(a) [of the Securities Act of 1933].” The court explained that it “determines that the SEC has demonstrated that the promotion of the ICO of the BLV token was a ‘security’.”